NexPoint Hospitality Trust Announces Second Quarter 2022 Improving Financial Results, Update on Sale of DoubleTree Portfolio, and Convertible Notes

DALLAS and TORONTO, Aug. 19, 2022 /CNW/ -- NexPoint Hospitality Trust ("NHT"¹), (TSX-V: NHT.U) announced the release of NHT's financial results for the three and six months ended June 30, 2022. All amounts are expressed in U.S. dollars.

The table below presents Net Income, FFO and AFFO. 

	For the Three Months Ended				For the Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
Net Income	$                   (2.1)		$                (5.4)		$                   (1.4)		$                  8.2
FFO²	1.0		(3.5)		6.9		(11.6)
AFFO²	(2.7)		(2.8)		3.8		(9.7)

The table below presents Occupancy, ADR and RevPAR.

	For the Three Months Ended				For the Six Months Ended
	June 30, 2022		June 30, 2021		June 30, 2022		June 30, 2021
Occupancy	69.9 %		66.4 %		66.1 %		59.2 %
ADR	$               161.79		$            121.02		$               154.96		$            106.47
RevPAR	$               113.64		$              81.91		$               104.58		$              65.32

Additional information on 2022 financial and operational results can be found at www.sedar.com in our 2022 interim consolidated financial statements and management discussion and analysis ("MD&A").

DoubleTree Portfolio

On March 8, 2022, the Company began the marketing process to sell its DoubleTree Portfolio. As of August 19, 2022, the Company has executed purchase and sale agreements with three different parties for the sale of the Beaverton property, the Tigard property, and Vancouver property for a combined purchase price of US$43.6 million. The Company expects these transactions to close at the end of the third quarter, with the possibility of an extension to close in October 2022. The Company will use the proceeds from the sale to pay down the outstanding debt on the DoubleTree Portfolio.

Subsequent to June 30, 2022, the Company decided to no longer market the Bend property and Olympia property for sale and will continue to hold those assets for the foreseeable future.

NHT Capitalization Updates

NHT announced that a subsidiary of NHT has, between April 1, 2022, and June 30, 2022, issued convertible notes (the "Notes") in the aggregate principal amount of US$1 million (the "Liquidity Transactions") to affiliates of NHT's external advisor.

The Notes bear interest at varying rates and are repayable in membership interests ("Membership Interests") of NHT's operating subsidiary, NHT Operating Partnership, LLC (the "OP"), which are redeemable for trust units of NHT ("Trust Units") at the option of NHT in its sole discretion. The approval of the TSX Venture Exchange will be required prior to any conversion of the Membership Interests into Trust Units. NHT used the proceeds of the Liquidity Transactions for general working capital purposes. Management believes the Liquidity Transactions will further strengthen NHT's balance sheet and liquidity profile to better position itself as the hospitality industry continues to rebound from the impact of the COVID-19 pandemic. The fair market value of each Note does not exceed and did not exceed at the time of issuance of such Note 25% of NHT's market capitalization.

Each of the Liquidity Transactions constituted a related party transaction as defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions ("MI 61-101"). The Liquidity Transactions were completed in reliance on (i) an available exemption from the formal valuation requirement of MI 61-101 provided in paragraph (a) of Section 5.5 of MI 61-101 and (ii) an available exemption from the minority shareholder requirement of MI 61-101 provided in paragraph (a) of Section 5.7(1) of MI 61-101.

About NHT
NexPoint Hospitality Trust is a publicly traded real estate investment trust, with its Units listed on the TSX Venture Exchange under the ticker NHT.U. and NHT is focused on acquiring, owning and operating well-located hospitality properties in the United States that offer a high current yield and in many cases are underperforming assets with the potential to increase in value through investments in capital improvements, a market-based recovery, brand repositioning, revenue enhancements, operational improvements, expense inefficiencies, and exploiting excess land or underutilized space. NHT owns 13 branded properties sponsored by Marriott, Hilton, Hyatt, and Intercontinental Hotels Group, located across the U.S. NHT is externally advised by NexPoint Real Estate Advisors VI, L.P.

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact: 
Jackie Graham
Investor Relations
[email protected]

Brian Mitts
Chief Financial Officer
[email protected]

Media Inquiries
[email protected]

¹ In this release, "we," "us," "our," and "NHT" each refer to NexPoint Hospitality Trust.

² FFO and AFFO are non-IFRS measures. See "Non-IFRS Financial Measures" in our MD&A for definitions of each of these measures and a reconciliation of these measures to Net Income.

SOURCE NexPoint Hospitality Trust